News

Springfield Ends FY 2014 $5 Million in Black

Initial numbers from the end of Springfield’s Fiscal Year 2014 show the city’s corporate fund, used to fund most city services, ended the year on Feb. 28 with a $5 million surplus.

Mayor Mike Houston said that’s because of unexpected revenue and good fiscal management.

“We have substantially reduced the employment within city government, we’ve tried to be more efficient,” Houston said. “But it really comes down to managing the budget and managing city government.”

Houston says the city saw a $1 million windfall from selling wholesale electricity.

Some aldermen at Tuesday’s city council meeting wanted to know if the administration would take steps to cut down on the unfunded police and fire pension liability. Budget Director Bill McCarty said that’s possible but there are a couple of large bills coming due they need to address first.

“The EPA Factory Street cleanup… that could be in excess of a million dollars, though we’re cautiously optimistic it won’t be,” said McCarty. “Then we have unexpected equipment needs. We have a half million dollar firetruck that I just found out the other day we need to purchase because the one that we have from 2001 is rusting out and is starting to fall apart.”

The windfall in the corporate fund comes despite serious hits in major revenue sources, including the city sales tax, which was $584,000 lower than expected. McCarty characterized the sales tax as the city’s largest revenue source.

“That’s something we need to pay attention to,” McCarty told aldermen at Tuesday’s city council meeting.

Other tax revenue was also down, including property taxes, which were $230,000 lower than expectations, and the telecom tax, which came in $383,000 lower than expected.

McCarty says the harsh winter is likely to blame for the sales tax drop off.

“We believe it was probably an anomaly,” he said. “It was a very cold winter, nobody was really out in it. They weren’t out buying. They were buying things online because they didn’t leave the house.”

The numbers presented are preliminary. McCarty expects a final audit, currently underway, to be done within a few months. A final picture should be available in August.